Organizers claimed that nearly 2 million Hong Kong protesters took to the streets Sunday in a rally to demand the city's top official resign a day after she suspended — but...China Politicsread more
Software engineers straight out of college often make six-figure salaries, not counting equity compensation.Technologyread more
Representatives from the Chinese side say they think it likely that Chinese President Xi Jinping will attend the G-20 meeting later this month. But in order to reach a trade...China Economyread more
Wall Street, though, is clamoring for a rate cut, with an 85% chance of a move in July and a 61% probability of three reductions by year's end.The Fedread more
A company spokesperson said the outage was the result of a "an internal technology issue" and was not security related.Retailread more
Using MIT's living wage calculator, CNBC Make It mapped out the minimum amount a single parent must earn to meet their basic needs without relying on outside help in every...Earnread more
Mired in a crisis over its best-selling 737 Max plane, Boeing could hand the spotlight over to its rival Airbus at the Paris Air Show.Airlinesread more
In the survey, 66% of Democratic primary voters say they'd be enthusiastic or comfortable about Biden as their nominee to take on President Trump in the 2020 election. Just...Politicsread more
You can save money by doing a quick check and unsubscribing from apps you no longer use.Technologyread more
The flattening of the yield curve is exuding a bad omen for the stock market if history is any guide.Marketsread more
Stratolaunch, the world's largest airplane, which flew once, is up for sale, sources familiar told CNBC.Investing in Spaceread more
Stock picking is making a comeback as active investors are on pace for one of their best years in a decade.
So far this year, 48% of large-cap active funds have beaten their benchmarks, according to Bank of America Merrill Lynch. That's the second-best rate since the financial crisis. Two years ago, the group had a similar breakout performance suggesting a "better backdrop for managers."
"Good news for active managers: stock-picking is making a comeback," Savita Subramanian, head of U.S. equity and quantitative strategy at Bank of America Merrill Lynch, said in a note to clients last week.
A key reason for the better performance is that stocks are now less correlated with each other, compared with sectors overall. That suggests that picking stocks now matters more than just picking a winning sector, Subramanian said. That's even more exacerbated by the trade war, which is helping and hurting different companies within sectors. For example, tech companies with more exposure to foreign demand have been underperforming.
Growth funds have fared best this year, with 60% outperforming the Russell. Slightly less than half of value funds have outperformed their Russell benchmark, while core funds are the biggest laggards.
Still, for those who are picking the right stocks, there appears to be a scarcity of opportunity, or so-called "alpha," so it's unclear whether their hot streak can last.
"The spread in performance between the best performing and worst-performing stocks (long-short alpha) has remained below average for the last several years, suggesting narrower spreads even if a manager had perfect foresight," she said.
Despite this recent boost in performance, there's been a massive overall shift to index funds and ETFs. The amount of money invested in passive funds has more than doubled since 2009, according to Bank of America. And the price to invest is falling as asset managers such as Fidelity and Charles Schwab race to undercut each other with lower fees. Passive asset management giant Vanguard now owns more than 5% of almost all S&P 500 stocks, Bank of America said.
"Despite better trends for active funds, we see risk that this secular shift from active to passive has more room to go, even if the pace of the rotation slows," Subramanian said.
U.S. funds active vs. passive as a % of AUM